A new productive order?
### Henri Wilno*
A FTER the upheavals of 1997-1998
(Asiatic, Brazilian and Russian crises), economic growth has been maintained in the USA (which has now effectively known the longest cycle of growth since the Second World War) and, despite its limits, appears practically consolidated in Western Europe. There is, moreover, a certain resurgence in Southeast Asia whereas the conjuncture remains uncertain in Japan.
This favourable conjunctural situation says nothing in itself on the evolution of the long "cycle", contrary to the triumphalist arguments on the "new economy" today advanced. In the same way, we cannot exclude a slowing up of this growth under the impact, for example, of a fall in the financial markets.
The economists who identify with our current have for a decade in various degrees been hesitant on the characterization of the situation. Until now the idea has been maintained that the neo-liberal policies could not throw up the bases of a regime of viable growth in the medium term. The following text puts forward a certain number of elements to modify this analysis. What framework of analysis?
The framework of analysis of the history of capitalism defined by Ernest Mandel is founded on the succession of movements over several decades, in which ascendant (expansionary) and descendant phases succeed each other in "long waves". The fourth long wave has experienced its expansionary phase from the end of the Second World War (a little sooner in the US) to the end of the 1960s.
At the beginning of 1970s, the world economy entered the descendant phase of the long wave. Ernest Mandel, following Trotsky and in opposition to Kondratieff,! insisted on the fact that there was no mechanism endogenous to capitalism which rendered automatic the passage to an expansionary wave after the recessionary wave. Understanding the passage to a new ascendant phase necessitates then the tak-
Debate: New Economy * ing into account of 'extra-economic factors (the modification of the social relationships of power in Europe in the postwar period).
In view of recent developments, it is worth examining whether the world economy is still in the recessionary phase of the long wave or if it has entered in a new ascendant phase. The expressions 'expansionary long wave' or 'ascendant phase of the long wave' lend themselves however to confusion inasmuch they can be interpreted as identifying themselves necessarily with a rhythm of sustained growth. All the more so in that the implicit reference is sometimes the 1945-75 period, during which average growth was exceptional with regard to that recorded over the long term by capitalism.
The term "productive order', derived from the French economists P.Dockès and B.Rosier2 undoubtedly allows us to designate more clearly the analytical issues at stake: has capitalism succeeded in reconstituting mechanisms of regulation which could guarantee a medium period stability, enlarged reproduction, and the maintenance of the rate of profit at an average level which could be considered as satisfactory?
Remember that each productive order rests on four elements:
1. A mode of accumulation of capital of whose analysis should take into account two aspects: the industrial and financial structures and the relationship between capital and labour;
2. A type of material productive forces;
3. A mode of social control ensuring the submission of the forces of labour to the economic order;
4. A type of international hierarchy.
We will then take up the elements that appear to us to characterize the main structural evolutions of capitalism, beginning (without implying that we consider it the most important element) with the material productive forces: the new technologies and the organization of the work process.
The role of new technologies
The analysis of new technologies and their impact involves distinguishing three levels: new products (goods, materials and services), the transformation of existing products and the evolution of the processes of production and circulation.
During the 1980s and the beginning of the 1990s, the new technologies essentialInternational Viewpoint #325 November 2000 29
The impact on global productivity is effect leading to productivity gains for the
Source: R. Gordon "Has the "New Economy" rendered the productivity slowdown obsolete?", 1999. Cited in P. Le Merrer, Cahiers français, 2000.
* Debate: New Economy ly concerned the last level and, to a lesser degree, the second. The techniques allowing a rapid treatment in great quantity of information? allowed the reorganization of the productive process ("just in time" "zero stock") in the direction of a more rapid and less risky adjustment to market openings. Thus, and it is an extreme case, the US microcomputer manufacturer Dell was able, in some of its factories, to organize its manufacture in periods of two hours, eliminating practically all stock.4
This is explained by the conjunction of several factors: the use of the Internet to take orders and manage relations with suppliers, the proximity between the installations of suppliers and factories, but also the specialization of factories and undoubtedly (although this is not stated in the article dealing with this case) strong demands on the flexibility of the workforce. The new technologies can also favor the externalization of certain tasks.
The possibilities of electronic trade allow, finally, the transformation of suppliers (some of them at least) and the reduction of costs by accelerating the delays in transmission of information and putting them into competition. The creation of a platform of 'B to B' (business to business) Internet exchanges was thus announced in March 2000 by General Motors, Ford and Daimler-Chrysler and they were joined in April by Renault and Nissan. The gains expected by the US manufacturers amounted to 10% of the cost of a vehicle, 6 while Renault appeared more prudent on this point.
This type of instrument would allow going still further in the direction of "zero stock" and fitting supply to demand. On the contrary, the generalized putting into competition of suppliers would be contradictory with the maintenance of stabilized links in the network; Renault has thus announced that this competition will not affect suppliers of the first rank. For its part, General Electric says that the online purchase of $2.1 billion of supplies would allow an economy of $234 million.?
In a general fashion, "what is at stake for the industrial enterprises is the use of however relatively limited for the moment, much inferior to the gains in productivity recorded before 1972, even if, in the most recent years, a resurgence is perceptible in the US, pioneer country in the area of the 'new economy. In fact what appears is a considerable gap between the gains in productivity in the IT sector and the rest of the economy (see box at foot of page).
### Analysis
This can be analyzed in a number of
• Either as a normal discrepancy, which would not be unprecedented, between the transformation of the capital stock and the growth of productivity? (computers still represent moreover a limited part of capital stock, of the order of 2% in the US). Also, certain economists10 argue that the rapid renewal of technology makes firms renew their productive capital more frequently: more capital is necessary for production.
• Or because the new productive methods lead to the growth of costs other than direct productive costs: with the development of road transport of commodities, for example. It also appears obvious that the effects of the new technologies are differentiated according to sector or according to the different stages operating inside the same sector: thus, in electronic commerce, the new technologies can have a direct impact on the conditions of purchasing decisions by enlarging the possibilities of information for purchasers; but once the supplier is chosen, there remains the very material problems of management of stocks and delivery which do not differ from those of the traditional enterprises based on sale by correspondence.
So is it true that by enlarging the possibilities of competition at the moment of the decision to purchase, the new technologies applied to commerce have an indirect suppliers? It is necessary finally to take account of the fact that some investments in new technology, carried out sometimes without adequate prior studies, have not had the effects expected.
• Or finally because the introduction of new technologies is carried out in a context where, despite the current euphoria (which follows a discourse on the deflationary risk), the market outlets remain stifled by wage restrictions.
Moreover, the triumphalist discourse on the creation of "high tech" jobs does not appear well founded: according to the estimates of J. Gadrey,' qualified jobs linked to new technologies only constituted a small part of the creation of jobs in the US. The preponderant part of jobs created between 1986 and 1996, qualified or not, do not correspond to the computer, database or Internet jobs.
The high rates of growth of employment in these activities correspond to the low numbers employed in them relatively to others. Between 1986 and 1996, the catering sector created 1.6 million jobs in the USA, that of health 2.9 million and that of IT services less than 700,000.
The predictions underline this: from 1998 to 2008, among the five types of jobs which should increase the most (in number of jobs) in the US, there are for sure analysts (+ 577,000 jobs) and 'general managers', (+ 551,000) but also truckers (+ 493,000), cashiers (+ 556,000) and retail salespersons (+ 563,000). 12 The number of database administrators should increase by 77% but this only represents 67,000 supplementary jobs.
Moreover, some jobs in the new high tech sectors are classical productive or commercial jobs: mobile telephones need workers to manufacture them, deliverers to deliver them and salesperson to be sold (see below for details of the working conditions at Amazon.com).
The new element in recent years is the transformation of certain products related
Annual average change in hourly productivity of labour in the USA (%)
NIT [new information technologies] to reduce stocks and related costs, shorten delays in delivery of equipment, accelerate the cycle of development of new products, lower the costs of distribution. Overall, the objective is a considerable improvement in the profitability of industrial activities'8
30 International Viewpoint #325 November 2000
1950-2 to 1972-2
Sectors
2.63
All outside agriculture
2.56
Industry
IT
Non-equipment industry
2.96
1995-4 to 1999-1
1972-2 to 1995-4
2.15
1.13
4.58
2.58
41.70
17.83
2.05
2.03
to the new technologies into 'mass' consumer goods: micro-computing, mobile telephones. Their diffusion has been accompanied by that of related products
(software, services). It should also be noted that these goods are subjected, by producers and diffusers, to an accelerated obsolescence which allows the renewal market to be enlarged while the market of primary equipment is still not saturated.
Organization of the work process The segmentation of the workforce is the lightning rod of the reorganizations taking place in the work process. These reorganizations have two complementary dimensions: one concerns the productive units, where size is reduced and relations are agencied through networks, the other concerns the management of "human resources"
The average size of companies has tended to reduce as a result of the reduction of employees in industry which undermines the big concentrations of workers. Externalization was at first confined to peripheral activities but now subcontracting affects not only certain "inputs' (car parts) but segments of production, management and indeed research (12% of the labour costs of Renault's centre for research and development - the "Technocentre' - are accounted for by external bodies). 13
The externalization of research is also a feature of the chemical-pharmaceutical sector. New centres of car production are characterized by the installation on the same site of the "constructor" ", order supplier and subcontractors Smart in Lorraine, new Volkswagen factory in Brazil).
The phenomenon of "productive decentralization" is in fact accompanied by a reinforcement of financial concentration 14: small and medium enterprises, which it is fashionable to eulogize, are often included in the conglomerates: thus in France, in 1994, more than 70% of the turnover of small and medium enterprises of 200 to 500 employees was controlled by conglomerates, against 44% in 1989.
Moreover, enterprises tend to split up into autonomous subsidiaries. The establishments of the conglomerate are sometimes put into competition with each other and the relations between them contractualised. The enterprise is boiled down to
Miracle on Wall Street? "centres of profit"
Hence the modalities of the segmentation of a workforce can vary according to the institutional forms of the country in which it is employed.
A survey in four European countries on flexibility among subcontractors in the car industry concludes, for example, that recourse to overtime, temporary work and short-term contracts varies.15 In Spain short-term contracts predominates. In Great Britain, car parts manufacturers prefer overtime (here, moreover, legal protection against dismissal is not too rigorous). In France interim work is favoured.16 In Germany, a stricter labour code (at the time when the survey was carried out) leads to an array of diverse instruments of flexibil-
It's particularly interesting to note that in the transnational subcontracting groups, it is not the country of origin of the company but the localization of the establishment which determines the choice of the form of flexibility. In other words, flexibility is certainly a general tendency, but its forms remain determined by national institutional structures.
Moreover, the gains in productivity of certain sectors of the "new economy' stem from the introduction in new spheres of classic methods of management used in industry: at Amazon.com (an online bookshop in Bad Hersfeld (Germany), the employees work six days out of seven, from 7 to midnight and the time taken by each worker to assemble the orders of books is monitored. Moreover, books are classed neither by author, nor by theme, but by number of orders: the most demanded are the most accessible. 17
Debate: New Economy *
Rate of profit and role of the financial markets Since the mid-1980s, the rate of profit (as calculated by the share of value added between wages and profits) has returned to high levels in the main countries of
Western Europe. In France, not only the impact of the "oil shock" but also that of the big strikes of May and June 1968, has been overcome (The workers earn as much as in 1958', , runs the headline of a French economic magazine). 18
The restoration of high rates of profit goes back several years; for a long time, it has not been reflected in investment: a part of the funds available has underpinned the growth of the financial markets. Recently, investments have picked up, initially in the US then in Europe, but the companies remain globally easily able to finance them. We are faced with an apparently paradoxical situation: the affirmed role of the financial markets is considerable whereas the big companies have not often needed them to finance themselves.
The rate of self-financing of companies has been more than 100% in France for several years and in the US the companies globally pump more capital into the markets (in the form of financial investments) than they have taken out of it.19 More than financing investments, the role of the markets appears then to consist in ensuring the circulation of share capital and above all disciplining shareholders and workers.
However, the companies linked to the new technologies (telecommunications, biotechnologies and above all electronic commerce) have largely resorted to the financial markets to fund their development and the buying up of competitors (paid in shares). Significant capital has been raised on the hopes of development rather than on concrete data (some "new economy" companies have up until now accumulated losses).
It is another of the paradoxes of the current situation: on the one hand, the norms of return on investment and profitability which companies have to satisfy are increasingly high (the famous 15% of net profitability, on the other hand, some shaky projects find financing easily enough: Boo.com (selling clothing on line) had, before going under in May 2000, 'burnt' $135 million in two years.20
Some significant stock market readjustments came in 1999 and in the spring International Viewpoint #325 November 2000 31
* Debate: New Economy of 2000 on the US Nasdaq. In August 2000, Amazon.com shares lost 72% of their value in relation to their record level of December 1999.21 It is difficult to know if this indicates a growing prudence on the part of the markets and the obligation for the 'new economy companies to resort to financing on criteria which are in principle
To explain the enhanced role of the financial markets and the shareholders, some speak of an alignment of European continental capitalisms with an AngloSaxon model. This type of analysis is debatable. As F. Lordon says, "That US capitalism has for a long time been a sharebased capitalism is not to be doubted but that does not mean that it has always been under the sway of a shareholders' power".22 Lordon recalls on this point the analyses of the US economist J K.Galbraith in the 1960s on the power of "managers" in US companies and the "technostructure"
However debatable these analyses, it can hardly be doubted that the USA has also experienced, albeit earlier than Europe, a collapse of the decision making mechanisms which made the power of the shareholders more direct ("corporate governance"). The collapse now seems general, in France and, above all, in Germany and Japan given the challenge to bankcompany links. This reinforcement of the direct power of the shareholders over the management of industrial capital relies on the availability of information, control and production of norms.
The big auditing and consultancy offices are largely internationalized, but their centre of gravity is essentially found in the US. The same goes for the agencies of financial information. All these organs are producers of norms of behaviour which frame the management of the "managers" It's also worth noting the tendency towards homogenization of the rules of presentation of their results by the big companies, which allows shareholders greater scope to put forward a point of view on the evolution of the many companies in which they hold interests.
Certain points merit being clarified. They turn around a central question: where is the power in this 'new' capitalism? There is no difficulty in demonstrating that shareholding democracy is only a myth and "that beyond the symbolic gesture to the annual general meeting, the power of the small shareholder has only the alterna32 International Viewpoint #325 November 2000 tive of non-existence or subordinacy to the big intermediaries" (F. Lordon).
There is no more difficulty (despite the illusions of some in demonstrating that neither the trade union pension funds, nor the so-called 'ethical' funds constitute instruments capable of running against the logic of the system. To analyze things a little more precisely:
• The articulation between institutional capitalism (which can be managed by employees) and capitalists in the sense of the term (persons drawing a predominant share of their income from the ownership of capital): traditional or new bourgeois families, on the one hand, and salaried managers "transmuted" by the grace of stock-options and other possible forms of participation in capital.
• The resurgence of familial capitalism in France: familial control covered, in 1999, 23% of the 50 biggest companies against 11% in 1984. For sure, during this period the share of the state fell by two thirds (from 74% to 25%), but some familial groups were strengthened through privatization (like the Lagardère group). Is it a French specificity? Of a durable tenden-
The first point appears particularly important, leaving aside the summary analyses in Le Monde diplomatique which stress the 'domination of pension funds'.23 Analyses contested by Michel Pinçon and Monique Pinçon-Charlot, who write in a recent work: "the discourse about managers and institutional investors (pension funds and Anglo-Saxon mutual funds) tends to conjure away the bourgeoisie and their families as veritable beneficiaries of the levies on the wealth produced. All this hides the interests attached to this or that patronymic to the benefit of abstract diagrams intended to make us believe in a diffusion without principle and without limits of the ownership of capital" 24
Evolution of the wage relation-
This is an area where the national institutional configurations remain important. But the general meaning of the developments underway appears clear: the individualization of the conditions of work (the share of full time workers with flexible hours nearly doubled in the US between 1991 and 1997, going from around 15% to nearly 30%) and that of the wage relationship expressed by the decline of "traditional" work contracts in relation to "atypical" contracts and, in the most extreme cases, the substitution of relations regulated by commercial law by those reminiscent of a time prior to the labour code.
It amounts in fact to an attack on wage-earners in all areas of production. In the capitalism of the postwar boom, the bosses had the right to decide the rhythms of work and to dismiss, but within this framework the workers had some certainties as to their hours and the amount of their wages at the end of the month, indeed they could benefit from certain advantages because of their length of service (at least in those sectors where a certain collective relationship of forces existed).
These guarantees are now swept away. The central objective is to obtain the maximal availability of the workforce and to reduce its cost. Acquiring the loyalty of personnel becomes a secondary preoccupation, except for a minority.
It's worth remarking that this evolution, overall, has only a very indirect relationship with the "technological revolution" to use the fashionable vocabulary25 and that it concerns every sector. Some extreme cases of revision of traditional work have been seen among delivery workers, construction workers and so on.
Commenting on the (victorious) strike of workers at Verizon (one of the most important US operators of local and portable telephones) in August and September 2000, an editorialist for Business Week summed up in a lucid fashion: "The distinction between old and new economy has always been something of a myth. In telecommunications, the unionized [employed in the old companies of traditional telephony] installers, technicians and traders do the same work as their non-unionized equivalents [in the new companies] and employ similar technologies. The big difference is that the unionized workers enjoy greater security of employment, better conditions of work and, in very many cases, higher pay" 26 The author adds that the way in which the recent gains in productivity of the US economy will be divided between directors, shareholders, clients and workers will depend more on the political relationship of political than economic and technical imperatives"
Beyond individualization, we should draw attention to the development of the inequalities of remuneration, which can only be fully appreciated by taking into
account the development of part time work. In a general fashion, the two last decades are marked by a strengthening of inequalities in most developed capitalist countries to the profit of the beneficiaries of capital incomes. International division of labour and hierarchy of powers
The hierarchy of powers can be very schematically summed up in the following manner:
• In the USA, a military predominance and an economic power that equals that of the EU. There is undeniably a 'comeback' by the US and the hypotheses on its decline are not really verified
If growth has allowed the US budget's return to surplus, the current deficit remains considerable. The rate of household savings is particularly low and the rate of indebtment of private agents is very high (140% of GDP).
The absence of external constraints on the US economy is undeniably a factor favorable to growth: the dollar remains a refuge-currency independently of the US trade deficit.
Europe remains subordinated on the military level.27 In the area of monetary policy, competition and foreign exchange, the European consensus implemented by the European central bank and the Commission (with the backing of the Council of Ministers) is more dogmatically neoliberal than what is effectively practiced on the other side of the Atlantic. The growth of the EU is both limited and virtuous which allows it to record trade surpluses but does not stop the depreciation of the Euro.
• As for Japan, it seems to be in the process of passing from one mode of economic regulation to another or, at least, eroding strongly the specificities of its capitalism. This is shown by the evolution of bank-industry relations and the opening to capital and, to a certain extent, to foreign products. The macro-economic conjuncture remains uncertain, but the current surpluses of Japan allow it, together with the EU, to finance US growth.
With the creation of the Euro, there are no longer more than three currencies with an international status: dollar, yen and euro (the pound being without doubt destined to join sooner or later the Euro). Exchange rate movements over the last 18 months have shown that the degree of international cooperation has been insufficient to avoid erratic movements, but that does not mean the G7 could not set up a strengthened coordination on this level if the situation really demands it.
This rapid examination of the international landscape should include the international institutions, in which the USA often plays a major role. As far as economic regulation is concerned, beyond the unknowns (Seattle, Russian crisis), the IMF/World Bank/WTO triptych is far from being paralyzed and inefficient, in relation naturally to its real objectives rather than the generalization of the well-being of humanity as a whole. The same goes for the G7 (G8 with Russia). On the military level, NATO has survived the "Cold War" and has even won new members with the former allies of the USSR in central and eastern Europe.
The US empire of the 1950s and 1960s has for the moment been substituted by a cooperation between "equals" where one country (the USA) is visibly more equal than the others (Europe and Japan). A setback in the organization of the workers
The partial or more global defeats of the working class in several countries, the restructuring of the productive apparatus, the policies of governments of social-democratic leadership in Western Europe and the collapse of Stalinism have had serious effects on the level of consciousness of the various working classes. Here we will restrict ourselves to enumerating some elements of the landscape:
• A decline in significant elements of class-consciousness among the dominated (notably the idea of a collective hope whereas the rulers, for their part, experience no dark night of the soul. As Pinçon and Pinçon-Charlot write in relation to the bourgeoisie: "Class in itself and class for itself, it is alone today in possessing this character essential to a real class capable of being mobilized".
• A trade union movement globally weakened and disorientated although demonstrating some counter-tendencies (more combative leadership of the US AFL-CIO, movement of December 1995 and creation of the SUD trade unions in
In Western Europe, for example, the degree of dependence (not only ideological but material) of the main trade union con-
Debate: New Economy * federations in relation to the states, to the employers and the Brussels institutions is considerable. This creates a material basis for a bureaucratic trade unionism of which the French CFDT is a particularly striking example.
• A growing divide between the popular masses and the political apparatuses. The Communist Parties of Stalinist origin have suffered a considerable decline and the link between the social-democratic parties and the popular layers tends to grow increasingly (the leaderships of these parties have moreover an increasingly technocratic and decreasingly militant profile). One of the consequences of this situation is an electoral abstentionism fairly closely related to income, which can also, in a more optimistic vision, be interpreted as an awakening of consciousness among some sectors of the population that, in the current configuration of the parties, elections will not change very much. Another form of depoliticisation affects the intermediary "elites". partly persuaded that the choices are no more than technical.
These evolutions are not without counter-tendencies. Beyond the phenomena already signaled at the trade union level, we should note a beginning of the organization of employees, indeed struggles, in certain segments of the "new economy" the development of a new anti-imperialist radicalism, the strengthening of the revolutionary far left in several European countries (Portugal, UK, France...). All this is essential, the more so in that it is more the product of the contradictions of the new period than nostalgia for the 1970s.
Integration and repression
Unequally explicit according to the country, the project of the dominant class in relation to the dominated appears to take on two aspects.
The first corresponds to a vision of integration of a fraction of the workforce in the capitalist logic via mechanisms tying pay or pensions to company profits: employee shareholding, employee savings, pension funds, and so on.28 The motivations for these projects are diverse: disciplining the behaviour of a fraction of the employees (to make them accept smaller wage increases, to encourage a company "patriotism" and so on),29 it can also be about replacing the systems founded on collective guarantees with instruments linked to the financial markets.
International Viewpoint #325 November 2000 33
* Debate: New Economy
Some significant nuances exist moreover in the modalities of these projects. Some are potentially aimed at large sections of the workforce, others concern only the higher managers. Some try to organize a specific representation of the employeeshareholders or envisage a specific role for the trade unions, others do not.
The neoliberals stress the supposed growth in motivation of a workforce whose current income to some extent depends on the performance of their company and whose future income will be linked to the performances of pension funds.
Certain ideologists (the French economist Michel Aglietta or Britain's Robin Blackburn) or some fractions of social democracy insist rather on the participation in decision-making by the employee shareholders or control of pension funds (through trade union representatives). But these contradictions are of a secondary order and the social-democratic discourse essentially gives a 'left' legitimacy to the neoliberal projects. 30
The second aspect is repressive. It amounts to a punitive treatment of the social insecurity and marginality which are essentially the consequence of neoliberal policies. On the US model, the European governments, including those "of the left" tend to practice the "police and prison management of poverty".3i In the poor quarters of the cities of the developed countries, the presence of the state and the public services is often insufficient or unadapted, except for the police force.
The recourse to the "forces of order" is moreover sometimes demanded by a fraction of the inhabitants who suffer the consequences of delinquency and the "incivilities" of some youth. But the police are capable of other uses in case of strong social tensions in the future.
By way of conclusion
Does all this amount to a system and allow us to conclude that a new productive order has been put in place?
The answer seems to be yes, at least to the author of this article. A particular mode of regulation, socially regressive but not inefficient from the capitalist point of view, has been installed. In that sense, one could say that capitalism has emerged from 'Crisis', or, to take up the terminology of Ernest Mandel, from the recessionary long wave which began in the early 1970s. 34 International Viewpoint #325 November 2000
US productivity has surged The factor unleashing this change of period is not constituted by the new technologies: whatever their impact they have no autonomous capacity to model the economy and the society of tomorrow.
On the contrary, the accumulation of partial defeats partial suffered by the employees in the main developed capitalist countries has allowed the bourgeoisies not only to "make the workers pay for the crisis" but to set up the basis of a new regulation.
We should without doubt integrate in the analysis two other major factors: the deployment of a framework of unification of Western Europe structurally orientated for the implementation of the neoliberal project and the collapse of the USSR which, although there were no tears to shed over what no longer constituted an alternative to capitalism, represented a considerable ideological victory for the latter, freeing it from any necessity of proving its legitimacy not only in the economic but also in the social area.32
The "new economy" is being set up on the basis of a higher rate of profit where the overabundance of capital makes a fraction of it available for sometimes quite risky investments. To avoid any equivocation, we should stress that the end of the "Crisis" would not mean in any case a return to the postwar boom. The current expansion of the US and western European economies represents a comeback but is far from equaling the performances of 1948-1970.
An eventual strong reduction of unemployment in Europe if this growth is maintained, which is not guaranteed, would not lead to a rehomogenisation of the workforce but on the contrary would follow the US model in its maintenance of strong disparities and significant pockets of poverty.
We must also take account of the intrinsic limits of this new regulation linked to the conditions of its establishment:
• Limitation of market openings because of wage austerity in the advanced countries and "structural adjustment policies" in the countries of the South and East;
• Lack of congruence between supply of commodities orientated by profit and social demand;
• Fragility of a macro-economic setup which is largely dependent on the financial markets.
All this could entail significant conjunctural upheavals and recessions like that of 1992-1993. The political and economic powers are conscious of the possibility of events of this type. The beginning of the campaign on the irresponsibility' of OPEC is evidence of it: the OPEC countries form a convenent scapegoat in the event of further perturbations.
Whatever the ups and downs, the weak social legitimacy of the model (in the eyes as much of the "down and outs" and the "poor workers" as of a large part of the workforce who have fairly stable jobs but are subjected to a permanent pressure and are uncertain of their future and that of their children) offers a point of support to the reconstruction of a radical anticapitalism and makes any reformist alternative a fragile one.* * Henri Wilno is an economist and a member of the Groupe de travail économique (GTE) of the Ligue communiste révolutionnaire (French section of the Fourth International). 1. See Leon Trotsky, "On the long term dynamic of capitalist economy (1921) and "On the theory of "long cycles" of professor Kondratieff" (1923) 2. P. Dockès & B. Rosier, "Rythmes économiques. Crises et changement social, une perspective historique", La Découverte/Maspero, 1983. The notion of productive order is also presented in a summary form in C. Barsoc, "Les rouages du capitalisme", La Brèche, 1994. 3. Owing to the ignorance of the author this text does not refer to biotechnologies and their possible consequences. 4. Le Monde interactif, September 13, 2000. 5. In the jargon of the new economy, "B to B" is opposed to "B to C" (business to consumer), employed to designate activities where the final consumer is an individual. 6. Libération April 17, 2000. 7. Le Monde interactif, September 13, 2000. 8. P. Le Merrer, "A la recherche de la "nouvelle économie'', in " Cahiers français " n° 295, March 2000. 9. See on this point the US studies quoted in the economic and financial report of the French government (October 1999). The incorporation of new technologies has always needed a certain time before being translated into technical progress at the macro-economic level: thus (according to P. David "The dynamo and the computer: an historical perspective on the modern productivity paradox", American
Debate: New Economy / Review *
Economic Review, 1991) electricity took nearly 40 years before it had its full effect on the global productivity of factors.
10. P. Artus, "La face noire de la nouvelle économie",
Libération, May 22, 2000.
I1. J. Gadrey, "Nouvelle économie, nouveau mythe?",
Flammarion, 2000.
12. Business Week, August 28, 2000.
13. It should moreover be remarked that the "Technocentre"
with 7,000 "permanent" workers (not counting temporary staff) has become the most important Renault establishment.
14. Thomas Coutrot, "L'entreprise néo-libérale, nouvelle utopie capitaliste?", La Découverte, 1998.
15. Steffen Lehndorf, "La flexibilité chez les équipmentiers automobiles en Europe", "Travail et emploi", n°72, 3/97.
16. A. Gorgeu & R. Mathieu, " Filière automobile : intérim et flexibilité", 4 pages, CEE [Centre d'étude de l'emploi], March 1998. 17. Libération, September 6, 2000. 18. "La face cachée du modèle américain", Le Nouvel Économiste, September 14, 2000. The headline was over a graphic illustrating the evolution of real weekly wages of workers. 19. "Critique de l'organisation du travail", Thomas Coutrot, La Découverte, 1999. 20. "Hitting the wall at Boo", Newsweek, July 27, 2000. 21. Some enterprises involved (partially) in the "new economy""and with very solid bases have also seen their shares fluctuate significantly — France Télécom, for example. 22. F. Lordon, "Fonds de pension, pièges à cons?", Raisons d'agir éditions, 2000. 23. The formula is used by Lordon who characterizes the US as a "financialised capitalism under the domination of pension funds". 24. Michel Pinçon and Monique Pinçon-Charlot, "Sociologie de la bourgeoisie", Repères, La Découverte, 2000. 25. Daniel Cohen, "La technologie nous enchaîne au travail", interview in /'Expansion of January 6, 2000. 26. Business Week, September 11, 2000. 27. "Europe will be credible when it can sustain a war effort of at least one year", interview with George Robertson, secretary general of NATO, Le Monde, March 25. 2000. 28. Stock-options mostly concern only a minority of managers and they are, in any case, very unequally shared. 29. In France, the distribution of shares to employees has also been a means of legitimizing privatizations. 30. This does not mean that there will not be significant debates on the modalities of the system to implement because real material interests are at stake and, moreover, the employers are very attentive to anything that could limit their power, even slightly. This explains the opposition of Swedish employers, some years ago, to national savings funds managed by the trade unions. 31. Loïc Wacquant, "Ce vent punitif qui vient d'Amérique", Le Monde diplomatique, April 1999. 32 We should also take into account that China, impelled by the bureaucracy, has started a process of capitalist restoration, certainly not completed but making it one of the principal destinations of international investment.